According to employees of the analytical division of the Binance cryptocurrency exchange, problems with scaling the Ethereum blockchain may lead to the loss of a dominant position in the field of tokenization.
States that Ethereum is still the most common blockchain for issuing tokens, but due to delays in confirming transactions and the high cost of processing them, token developers are increasingly turning to other blockchains.
Among the alternative options, analysts did not forget to mention the Binance Chain blockchain, which has better compatibility capabilities, higher throughput and has a built-in mechanism for matching requests for making transfers.
Analysts also recommended paying attention to the Tron blockchain. Two projects from its ecosystem ran their initial public offering (IEO) campaigns on the Binance Launchpad platform. Among the advantages of the Tron blockchain, more efficient decentralized data storage and expanded application opportunities in the gaming industry are highlighted. Analysts believe that this will have a positive effect on the spread of the technology among end users. The report provides information that more than 80% of activity in the EOS and Tron blockchains is related to gambling. For Ethereum, this figure is only 31%. This can be easily explained, since Ethereum was used mainly in 2017 during the “ICO mania” to raise funds for creating a variety of projects, including payment systems, technical projects, and so on.
The Ethereum blockchain is still the leader in the number of issued tokens, however, according to Binance Research, most of them do not carry any benefit, but only load the network, which already has limited resources. This is again explained by the ICO hype in 2017, when projects raised money for the sake of raising money, but subsequently did not provide a product with practical application and a successful business model. However, Binance Research noted that the vast majority of “promises” that were made in 2017 were not fulfilled due to problems with the scalability of the Ethereum network. Analysts mentioned other blockchains that have useless tokens, such as EOS, Tron, NEO and Steemit, but their number is much smaller. The best blockchain in terms of the number of tokens whose existence is justified by practical value, was, oddly enough, Binance Chain.
The main problem of the Ethereum blockchain, according to analysts , is high transaction processing fees. The figure in some cases can reach 30 cents. In addition, users cannot transfer tokens on the Ethereum network if they do not have ETH, which is charged as a Commission. Some other blockchains, such as TomoChain and Binance Chain, lack this feature.
According to the report, Ethereum is still the second largest cryptocurrency and the most popular blockchain for issuing tokens, but competitors have a better position because they can analyze the mistakes of the pioneer and prevent them. According to Binance Research, in the future there will be a wide range of blockchains with support for programmable transactions, each of which will have its own advantages and disadvantages.